RAW is compressed, but with a lossless method so the full file size can be recovered intact.
RAW delivers a full 12 bits of range, up to16 times that of the 8 bit jpg.
RAW is the image *before* the camera's internal processor applies destructive changes such as: white balance, exposure compression, data compression, saturation adjustments, and sharpening. All these *remove* data from the image, therefore RAW is the best image that the camera can deliver, period.
The camera creates the jpg from the RAW, whether you select to keep the RAW or not. The jpg *always* contains less data than the RAW and the jpg *always* can be obtained later from the RAW. Most dSLRs can provide both RAW and jpg together if you choose (I usually select small jpgs for viewing and emailing).
Why would you use RAW?
If the scene has a greater brightness range than 8 bits can capture (most scenes do).
If you might want to adjust the white balance after the fact (works better with 12 bits than with 8).
If you prefer to sharpen the image instead of let the camera do it (gives better results).
In other words, the only reasons not to use RAW is if you do not have the memory card space OR if you must shoot faster than the camera can write the larger files to the memory card (rare).
boB